Prominent cryptocurrency market commentator and former CEO of BitMEX Arthur Hayes predicts ‘shocking dump’ in the digital asset market around President-elect Donald Trump’s inauguration. However, Hayes adds that the expected market crash is likely to be followed by a mighty reversal of the upward trend.
Hayes warns against exaggerated expectations of Trump
Renowned cryptocurrency analyst Hayes shared a up-to-date blog post outlining his views on the cryptocurrency market’s trajectory in the coming year. According to Hayes, the disconnect between the cryptocurrency market’s high expectations for the incoming Trump administration and political reality will likely spook investors, causing a significant market sell-off.
Hayes points to the market’s unrealistic expectations for Trump, stating that “it is almost impossible for Trump to calm his base enough to prevent Democrats from taking back both legislatures in 2026.” As a result, Trump will have at most a year to implement any policy changes.
The crypto trader warned that if the market implements these restrictions, it will result in a “brutal sell-off” of digital assets. He revealed that his Maelstrom investment fund plans to book profits ahead of the expected sell-off and re-enter the market at lower prices in the first half of 2025. However, Hayes noted that he is open to “admitting defeat” if there is no correction by January 20 market.
Trump’s victory in the US presidential election sparked up-to-date hope in the cryptocurrency market, as a result of which the price of BTC exceeded $100,000 for the first time in history. As of this writing, the total market capitalization of cryptocurrencies is $3.81 trillion.
Trump’s victory also fueled speculation about the creation of a potential national strategic bitcoin reserve, which could spur competitive purchases of sovereign states by other countries. However, Hayes NO it is expected that such a provision will materialize in the near future. He explained:
While I don’t believe the US government will buy Bitcoin, it doesn’t affect my positive price outlook. Ultimately, the devaluation of gold creates dollars that must find shelter in real goods/services and financial assets.
Contrasting predictions for BTC price action
While Hayes predicts an imminent cryptocurrency market crash in early 2025, crypto services company Matrixport predicts otherwise. According to the recent X postthe company expects a “strong start” for BTC in 2025.
Similarly, Standard Chartered bank estimates that BTC could rise to $200,000 by 2025 as more institutions continue to accumulate the premier digital asset. A recent report from cryptocurrency exchange Bitfinex did as well predicts further growth potential of BTC after its consolidation around the price level of $100,000.
Even more ambitious price goals were shared by Bitwise’s Matt Hougan, who he said that purchasing BTC before reaching $500,000 would still be considered “early”. At press time, BTC is trading at $104,002, down 2.8% in the last 24 hours.
Featured image from Unsplash.com, charts from CoinGecko and TradingView.com
